The chief executive of Juul Labs, the dominant e-cigarette company that has been the target of public and regulatory outrage over the soaring use of teenage vaping, stepped down on Wednesday.
The executive, Kevin Burns, will be replaced by K.C. Croswaite, an executive from Altria, the major tobacco company that owns a 35 percent stake in Juul, the San-Francisco-based company.
Juul also said it would end one of its campaigns, “Make the Switch,” which the Food and Drug Administration had criticized as an effort to portray its e-cigarettes as safer than traditional cigarettes. The company also said it would not fight the Trump administration’s proposal to ban flavored e-cigarettes.
In addition, Altria and Philip Morris International said on Wednesday that they had ended talks to merge, dashing the chances of reuniting the two arms of what had once been Philip Morris.
In a statement, the companies said they would instead focus on rolling out the IQOS heated tobacco product in the United States. They emphasized that IQOS, which Philip Morris International sells abroad, is not “an e-vapor product,” unlike Juul’s devices.
This is a developing story. Check back for updates.
Thomas Cook holidaymakers and crew are free to leave Cuba, according to the Civil Aviation Authority.
Repatriation flights have been arranged with the aid of the British Ambassador to Cuba, it said.
Tourists had said they were prevented from leaving their hotels until they paid extra for their stay.
One holidaymaker, Sue Petrow, who was due to leave, said her hotel had told her she could be held at the airport unless she paid her bill.
Cabin crew from Thomas Cook had also said they were effectively being "held hostage" by security guards at a hotel.
But Dame Deirdre Hutton, the chair of the Civil Aviation Authority (CAA), told the BBC's Today programme: "That has been sorted out by the ambassador overnight, and the Cuban flight is in the air on its way back, which is very good news."
"It's also an example of how we're working very closely with the Foreign Office, which is great."
"It's very distressing for people who are finding difficulties with their accommodation, but what we've done is issue guarantees to the... hotels with Atol-protected British tourists," she added.
The British Ambassador to Cuba said hotels had been instructed to allow customers to depart without paying additional charges.
Antony Stokes said on Twitter: "Very grateful for patience of all affected in distressing circumstances."
Sue Petrow said she and other guests had refused to pay extra charges demanded by the hotel.
Holidaymakers like Sue may have paid for their rooms and meals months in advance, but hotels would normally only receive the money from Thomas Cook several weeks after their stay.
Reports suggested there was widespread concern in Cuba over whether the industry insurance fund Atol, which covers payments in the event of a firm failing, would foot the costs.
The fund covers bills that have been run up since Thomas Cook's collapse on Monday morning.
However, bills run up at hotels before Thomas Cook's collapse will not be covered. Affected hoteliers will have to apply to the liquidators for their money.
Counting costs
Dame Deirdre said the CAA had issued guarantees for payment to 3,000 hotels around the world, and had already started making the first payments. The CAA had 200 staff working with Thomas Cook employees, she added.
"Given how much those hotels are owed by Thomas Cook, it's hardly surprising that they are suspicious and angry," she said.
Thomas Cook owes hotels £338m, with one hotel in Mexico owed £2.5m, she added.
The Insolvency Service has written to local tourist boards to make sure hotels are working with the CAA on payments, Dame Hutton said.
Media playback is unsupported on your device
Repatriation
On Monday, the CAA launched the UK's largest peacetime repatriation operation to bring more than 150,000 people back to the UK after the collapse of the holiday firm.
So far, more than 95% of people have been brought back on their original day of departure, the CAA said.
On Tuesday, 70 flights brought back more than 14,000 passengers, it said. There are 70 flights scheduled on Wednesday, bringing back a further 16,500 people.
The flying programme will continue until 6 October with more than 1,000 flights planned.
Richard Moriarty, chief executive of the CAA, said: "I would like those remaining on holiday to enjoy the rest of their stay because we aim to also fly you home on the day when you were originally booked to fly with Thomas Cook, or very shortly thereafter.
"This remains a highly complex operation and I would like to thank holidaymakers for their patience as some inconvenience and disruption is likely."
Thomas Cook holidaymakers and crew are free to leave Cuba, according to the Civil Aviation Authority.
Repatriation flights have been arranged with the aid of the British Ambassador to Cuba, it said.
Tourists had said they were prevented from leaving their hotels until they paid extra for their stay.
One holidaymaker, Sue Petrow, who was due to leave, said her hotel had told her she could be held at the airport unless she paid her bill.
Cabin crew from Thomas Cook had also said they were effectively being "held hostage" by security guards at a hotel.
But Dame Deirdre Hutton, the chair of the Civil Aviation Authority (CAA), told the BBC's Today programme: "That has been sorted out by the ambassador overnight, and the Cuban flight is in the air on its way back, which is very good news."
"It's also an example of how we're working very closely with the Foreign Office, which is great."
"It's very distressing for people who are finding difficulties with their accommodation, but what we've done is issue guarantees to the... hotels with Atol-protected British tourists," she added.
The British Ambassador to Cuba said hotels had been instructed to allow customers to depart without paying additional charges.
Antony Stokes said on Twitter: "Very grateful for patience of all affected in distressing circumstances."
Sue Petrow said she and other guests had refused to pay extra charges demanded by the hotel.
Holidaymakers like Sue may have paid for their rooms and meals months in advance, but hotels would normally only receive the money from Thomas Cook several weeks after their stay.
Reports suggested there was widespread concern in Cuba over whether the industry insurance fund Atol, which covers payments in the event of a firm failing, would foot the costs.
The fund covers bills that have been run up since Thomas Cook's collapse on Monday morning.
However, bills run up at hotels before Thomas Cook's collapse will not be covered. Affected hoteliers will have to apply to the liquidators for their money.
Counting costs
Dame Deirdre said the CAA had issued guarantees for payment to 3,000 hotels around the world, and had already started making the first payments. The CAA had 200 staff working with Thomas Cook employees, she added.
"Given how much those hotels are owed by Thomas Cook, it's hardly surprising that they are suspicious and angry," she said.
Thomas Cook owes hotels £338m, with one hotel in Mexico owed £2.5m, she added.
The Insolvency Service has written to local tourist boards to make sure hotels are working with the CAA on payments, Dame Hutton said.
Media playback is unsupported on your device
Repatriation
On Monday, the CAA launched the UK's largest peacetime repatriation operation to bring more than 150,000 people back to the UK after the collapse of the holiday firm.
So far, more than 95% of people have been brought back on their original day of departure, the CAA said.
On Tuesday, 70 flights brought back more than 14,000 passengers, it said. There are 70 flights scheduled on Wednesday, bringing back a further 16,500 people.
The flying programme will continue until 6 October with more than 1,000 flights planned.
Richard Moriarty, chief executive of the CAA, said: "I would like those remaining on holiday to enjoy the rest of their stay because we aim to also fly you home on the day when you were originally booked to fly with Thomas Cook, or very shortly thereafter.
"This remains a highly complex operation and I would like to thank holidaymakers for their patience as some inconvenience and disruption is likely."
WeWork CEO Adam Neumann stepped down on Tuesday, just days after investors, including Softbank CEO Masayoshi Son, the company's largest, were in favor of ousting him.
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It may be the start of several changes involving the office-space provider.
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The company will be evaluated by incoming management with decisions to be made including cost cutting, which could involve cutting a few thousand of the company's 12,000 employees according to the Wall Street Journal.
Neumann will remain nonexecutive chairman and be succeeded by two of his deputies,
Artie Minson, finance chief of the parent company We Co.,will focus on finance, legal and human resources. Sebastian Gunningham, a veteran of Amazon, will handle marketing and technology.
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“We will closely review all aspects of our company with the intention of strengthening our core business,” the incoming CEOs said in a statement.
We Company postponed its initial public offering last week after potential investors pushed-back over among other things, the amount of control Neumann had over the company.
Despite postponing its public offering last week and replacing CEO Adam Neumann on Tuesday, WeWork could complete an IPO this year, business experts said.
The biggest obstacle will be valuation — how much potential investors are willing to pay for the company's shares and how much its existing shareholders are willing to accept.
After indicating last week it intended to press forward with its IPO in the near future, WeWork on Tuesday indicated it might be reconsidering that plan.
Many of the experts think the company will wait in order to give its new management team time to prove themselves.
WeWork put to rest a nagging subject of speculation on Tuesday with the announcement that Adam Neumann, the controversial founder, will step down as CEO. But the office-sharing company left another critical question unanswered: the timing of its planned initial public offering.
Even after everything it's been through lately, WeWork could still go public this year. At least in terms of the bureaucratic barriers needed to hold an IPO, there's not much that stands in the company's way, financial and business experts told Business Insider.
But in reality, WeWork will have to navigate a treacherous calendar if it hopes to pull off an offering this year. And even unburdened of Neumann's reputational baggage, WeWork's biggest challenge remains the one it's had to contend with since making its offering paperwork public in August — investor demand.
"It's all a question about the valuation," said Jay Ritter, a finance professor at the University of Florida who closely studies the IPO market, stating that WeWork will be able to find buyers for its IPO if it's willing to set the price low enough.
Of course, the price that public investors are willing to pay for the company's shares may far too little for SoftBank and WeWork's existing private investors to swallow. And until there's a consensus on that, an IPO will be incredibly tricky in the near term.
"Ultimately, I think that there's a price that this gets done at, in most cases, but is it a valuation that the current investors are willing to take?" said Steve Skolnick, an attorney with Lowenstein Sandler who's helped guide numerous companies through public offerings. "SoftBank is never going get their money back or their value back, at least not initially."
It's an open question where WeWork's IPO goes from here
What comes next for WeWork's prospective IPO has been an open question since the company postponed it last week in the face of resistance from Wall Street. At the time, it said it still planned to complete the offering this year, but already some investors and analysts were skeptical it would be able to pull it off.
And that plan may have been further thrown off track by its big management shakeup on Tuesday. The company announced it's replacing CEO Adam Neumann with two insiders who will share the CEO title — Artie Minson and Sebastian Gunningham, WeWork's former chief financial and chief revenue officers, respectively. While Neumann will remain as WeWork's non-executive chairman, he will no longer have majority control over the company, because it is reducing his votes, and his wife is relinquishing her roles at the commercial real estate giant.
Part of the pushback WeWork has faced from potential investors in its IPO focused on Neumann. A series of deals he was involved in with the company, including selling to it the rights to use the name "We," raised eyebrows. So too did revelations in a Wall Street Journal article last week that he had transported and smoked marijuana on a plane to Israel and frequently served copious amounts of tequila at executive retreats.
A statement released by the WeWork's co-CEOs Tuesday indicated that the company may be backing away from its plan to go public this year, saying they were "evaluating the optimal timing" for that to take place. The company has a big incentive to try to make the deal happen this year — its banks have agreed to loan it $6 billion if it raises $3 billion in an IPO by the end of the year.
WeWork faces a challenging calendar if it wants to list shares in 2019. The next few weeks will bring the Jewish high holidays, a period during which bankers and companies usually refrain from engaging in the IPO process. And the period after Thanksgiving is often considered a no-go for IPOs, with the winter holidays beginning and institutional investors, looking to lock in returns, hesitant to make bets on risky IPOs as the year comes to a close.
That leaves a very small window of time if WeWork wants to press ahead with an IPO in 2019.
If it does decide to go for it, WeWork faces little in the way of bureaucratic obstacles, business experts said. It was primed to start its road show — the series of meetings companies hold with potential investors immediately before selling shares in an offering — last week. To get the process back on track, it would basically just need to file some updated paperwork with the Securities and Exchange Commission that reflect the recent management and governance changes, they said.
"It can start the roadshow as soon as it wants, said Ritter. He continued: "It's not as if they're totally unprepared."
Investors have been skeptical of WeWork
The much bigger barrier WeWork is going to have to confront if it wants to go forward with its IPO is with investor skepticism. The pushback the company faced from potential shareholders encompassed much more than just Neumann's control and conduct. Investors and analysts were also skeptical of WeWork's business model, its ability to survive a recession, and its valuation.
The latest changes likely have raised fresh concerns with investors. Wall Street generally doesn't like uncertainty. By removing Neumann and replacing him with two relatively unknown executives, WeWork has essentially added an uncertainty to its business, said Robert Siegel, a lecturer in management at Stanford Graduate School of Business.
"There's no track record of these two people running this company," Siegel said. "I think it's going to be difficult for Wall Street to get comfortable with it in the next 90 days."
A deal probably could be done at the right price, the experts said. What that price will be and whether WeWork's existing investors would accept it are huge questions.
SoftBank valued WeWork at $47 billion in a funding round in January. But the company repeatedly indicated that it would be willing to accept a much lower market capitalization in its public offering, according to numerous reports. Immediately before pulling its IPO, it reportedly considered going out with a valuation of as little as $10 billion.
$10 billion may be the new ceiling for WeWork's worth
If it tried to go forward with its offering, that valuation may now be the ceiling of its possible worth in discussions with potential investors, said David Erickson, a senior fellow in finance at the University of Pennsylvania's Wharton School of business. The changes WeWork made almost certainly haven't raised it's valuation, at least not in the near-term, he said.
"I don't think valuation's going up" from where it was in WeWork's last conversations with investors, he said. "It's probably going either at that level or down."
SoftBank has already reportedly resisted having WeWork debut with a valuation in the $15 billion to $20 billion range, for fear of having to recognize steep losses on its investments in the company. It may well put up even more of a fight if the valuation drops even farther.
That's why several of the experts said they don't expect the company to go out this year. It likely will want to take the time to get Wall Street comfortable with its new management team and give the new CEOs some time to address the concerns about its business model and sustainability, they said.
"Given all they've gone through, I would think you would want to have a little bit of space to kind of address some of these issues," Erickson said.
Got a tip about WeWork or another company? Contact this reporter via email at twolverton@businessinsider.com, message him on Twitter @troywolv, or send him a secure message through Signal at 415.515.5594. You can also contact Business Insider securely via SecureDrop.
The UAW's strike against General Motors enters day 10 and while there are various issues being discussed, there is one point the two sides argue about the most.
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Temporary workers has been the top request among union members, according to the Detroit Free Press.
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Temp workers are union members doing the same work as permanent employees, but get half the pay and far fewer benefits.
The union wants a those workers to get a path to being permanent and as temps, get pay and benefits that more closely match their permanent counterparts.
Temps make up 7 percent-to-10 percent of GM's workforce over the course of a year and GM is holding firm to the status quo, according to the free Press.
Temps account for about 4,100 workers at the end of 2018. Ford had about 3,400 temps and Fiat Chrysler Automobiles had 4,800, according to the UAW.
GM has reportedly backed off on proposing that workers pay for more of their health care — initially proposing a 15 percent share rather than the autoworkers' current 3 percent — but wanted the UAW to bend on temporary workers.
It marks a startling fall from grace for the ambitious 40-year-old billionaire.
So what's his story?
From kibbutz to co-working
Born in Israel, Mr Neumann served in the Israeli Navy before moving to New York to "get a great job, have tons of fun and make a lot of money", as he put it in a 2017 TechCrunch interview.
He enrolled at Baruch College at the City University of New York in 2002, but dropped out just shy of graduation to go into business.
One of his early ventures was a baby clothing company that evolved into the luxury Egg Baby brand.
Later, he and business partner Miguel McKelvey, an architect, renovated an office space and sublet the property. They sold the business but the idea grew into WeWork.
In interviews, Mr Neumann - who finally got his degree in 2017 - has tied WeWork's origin story to his own, linking his itinerant childhood and time spent living on a kibbutz to WeWork's emphasis on communal working.
He told Israeli newspaper Haaretz in 2017 he sometimes even refers to WeWork as "Kibbutz 2.0".
Easy money
Mr Neumann's colourful personality once charmed investors, including Japanese investment giant Softbank, a major backer of WeWork.
Softbank's investments helped the company reach a peak valuation of about $47bn (£37.7bn) despite steep, ongoing losses - a mismatch that has drawn repeated questions.
Mr Neumann attempted to address that puzzle, telling Forbes in 2017: "Our valuation and size today are much more based on our energy and spirituality than it is on a multiple of revenue."
WeWork's growth made Mr Neumann a billionaire, with an estimated net worth of $2.2bn, according to Forbes.
His glamorous personal life - his wife Rebekah is the cousin of actress Gwyneth Paltrow, while his sister Adi is a former model who was once a Miss Teen Israel - contributed to the buzz around the company.
But the mixing of work and pleasure - which had been a key element of WeWork's culture - became a problem as the firm set out plans to go public.
Potential investors questioned the links between Mr Neumann's personal finances and WeWork, as well as his decision to expand WeWork into areas of personal interest, such as surfing and a school.
They also raised questions about his judgment amid complaints about his hard-partying ways.
Magic fades
WeWork tried to respond to those concerns. Among other steps Mr Neumann returned $5.9m in stock he received for selling WeWork the trademark "We".
But even the announcement on Tuesday that Mr Neumann would step aside and reduce his voting power failed to quell questions about WeWork's long-term prospects.
Critics have long said WeWork was little more than a typical real estate company, and its shaky finances had been obscured by Mr Neumann's personal style.
